The regulator sent its queries to the companies earlier this month and asked them to respond in two weeks.

BENGALURU: The Reserve Bank of India (RBI) has asked all registered peer-to-peer (P2P) lenders to furnish details about borrowers, lenders, their financial profiles, total exposure of participants and the financial health of the platforms themselves as it looks to assess the overall wellbeing of the sector.

The regulator sent its queries to the companies earlier this month and asked them to respond in two weeks, said people with knowledge of the matter. The RBI didn’t respond to ET’s email seeking comment.

“It shows that the RBI is taking active interest in regulating this space and ensuring that players do not violate prudential norms in any manner,” said one of the people mentioned above.

ET understands the RBI has sent the platforms a spreadsheet that needs to be filled in. This includes data on their net owned funds, metrics such as profit, loss, operational expenses, delinquency status of loans disbursed and overseas investments in the companies. Going forward, the platforms will have to report these numbers to the RBI once every three months.

“Traditional non-banking finance companies also have strict reporting requirements,” said another person cited above.
Limitations of the Platforms

“RBI is now devising this quarterly reporting feature for the P2P lending space as well, showing that they are keeping a close eye on the space,” added this person.

The move follows several NBFCs losing registration in the past few months as the regulator has clamped down on those not adhering to the rules. The platforms currently don’t have any means of checking whether an investor is adhering to the ₹10 lakh participation limit in P2P lending imposed by the RBI, said experts. The same cap applies to borrowers as well. Platforms rely on self-declaration to remain in compliance.

“Maybe the regulator will use the data to see if the limits they have imposed are being adhered to and devise ways to prevent violations,” said the founder of a P2P startup. “They have asked for details about borrowers’ overall exposure and how much exposure each person has to one loan.”

A person cannot lend more than ₹50,000 to a single borrower across all registered platforms, as per RBI norms. P2P lenders say the ₹10 lakh limit is making it difficult for them to scale up business, ET reported on January 25. Only a few have managed to attract VC funding.

“We are hoping that the regulator will take this data point and look at the need for caps to be relaxed a bit so that the business can expand and we manage to get lenders easily,” said one of the persons cited above.

Experts said the move may help RBI crack down on those promising attractive returns or not sharing updated delinquency numbers on their websites for consumer awareness.